Whistleblowers Fight for Portion of Settlement Despite Possible Statute of Limitations Defense

Two courageous whistleblowers are taking their fight for a qui tam reward all the way to the United States Supreme Court, asserting the government would have never recovered the $36 million it received from Houston-area doctors Dr. Arun Sharma and Dr. Kiran Sharma but for their information and participation in the investigation. After two dismissals of their case by the Texas District Court and Fifth Circuit, whistleblowers Samuel Babalola and Kayode Samuel Adetunmbi are seeking certiorari to argue their position to the highest court in the land. The battle may be uphill, however, as the whistleblowers do not contest the fact they filed their qui tam lawsuit after the settlement with the Sharmas was announced.

Details of the Appeal

As we have previously reported, a qui tam plaintiff must be the original source of the information giving rise to the false claims allegations. Information derived from news stories, investigations, public records, or judicial proceedings on its own is insufficient for the filing of a qui tam complaint and will result in a dismissal.

In today’s case, plaintiffs Babalola and Adetunmbi were co-workers with the Sharmas, who are already serving an 18-year prison sentence for extensive and widespread Medicare and Medicaid fraud within their asthma and allergy clinic. At the outset, before the case was ever filed, Babalola and Adetunmbi sent anonymous letters to various Texas and federal health authorities alerting officials as to the Sharma’s practice of overbilling and billing for services never rendered. The government thereafter allegedly relied on the information in its subsequent investigation of the doctors, which resulted in a $36 million settlement and the imposition of criminal penalties.

Unfortunately, Babalola and Adetunmbi, who worked as medical assistants in the Houston-based medical center, waited until November, 2011 to file their claim under the False Claims Act. Since the settlement with the doctors occurred nearly one year earlier, the court promptly dismissed the action based on the notion the underlying facts were previously revealed in investigative and court documents.

The whistleblowers promptly appealed their case to the Fifth Circuit, which rendered the same opinion. More specifically, the Fifth Circuit reiterated the requirement that, in order for a whistleblower plaintiff to recover under the FCA, he must have filed his action prior to the government’s decision to intervene. Once the government has launched its own investigation into the matter, private whistleblowers are no longer eligible to commence an action based on the same misconduct.

Presently, the whistleblowers are seeking redress from the United States Supreme Court based on the premise that, but for their anonymous letters alerting authorities as to the presence of fraud, the government would never have recognized the misconduct and would not have recovered the $36 million settlement from the clinic. The whistleblowers’ petition specifically asserts there is “no dispute that the indictment resulted from the charges first reported in the petitioners’ letter.”

The federal government, however, takes a different view – asserting the whistleblowers simply waited too long to file a qui tam action and their lawsuit must be dismissed.

Contact an Attorney Today

If you are aware of healthcare fraud, but are unsure whether you are an original source under the FCA, talk to an experienced whistleblower attorney today. The False Claims Act contains specific language and requirements that a whistleblower attorney could best explain and apply to your case. For an appointment, contact Berger Montague today.